Short answer: probably not. When interest rates rise, most service businesses get fewer easy enquiries, not zero enquiries. Cutting marketing completely usually means your competitors pick up the work you would have won. The smarter move is to spend more carefully, not stop.
On 30 September 2026 the Reserve Bank raised the cash rate by 0.25% to 4.60%, its fourth rise this year. The board said it could raise rates again "if required". Here's what that means if you run a trade or service business, and what to do about it.
How rate rises hit service businesses
Higher rates mean higher mortgage repayments, and that changes how homeowners spend:
- Big jobs get delayed. Renovations, extensions, pools and landscaping are the first things people put off.
- Urgent jobs don't stop. A burst pipe, a broken hot water system or a leaking roof still gets fixed.
- People shop around more. Expect more quotes per job and more questions about price.
- It takes time to flow through. CBA economists note that rate changes can take up to 18 months to have their full effect, so the slowdown is gradual, not overnight.
Why cutting marketing is usually the wrong move
When things tighten, plenty of businesses cut their ads first. That means less competition for the customers who are still spending. If you keep showing up while others go quiet, you can often win work at the same or lower cost.
The businesses that struggle most are the ones that stop everything, then try to restart from scratch when work dries up. Rebuilding an audience and an ad account from a standing start takes weeks.
What to change instead
1. Lead with the jobs people can't put off
If you do both urgent and optional work, shift your ads toward the urgent side. A plumber might push emergency repairs and hot water replacements over bathroom renovations for a few months.
2. Make the offer easier to say yes to
Payment plans, smaller starter packages, or a fixed price for a common job all lower the barrier. "Free measure and quote this week" still works, but give people a reason to act now.
3. Watch cost per job, not cost per lead
When people shop around, you'll win a smaller share of quotes. A $30 lead that never books is worse than a $60 lead that turns into a paying job. Track every lead through to a paid invoice so you know what a customer really costs you.
4. Follow up faster than everyone else
When people get three or four quotes, the business that calls back first often wins. Speed costs nothing and matters more when buyers are cautious.
5. Cut waste, not reach
Turn off ads that bring in poor leads, tighten your service area, and stop paying for things you can't measure. Keep the ads that are actually producing jobs.
How much should you spend right now?
Work backwards from the jobs you need. Decide how many jobs you want a month, how many quotes you usually win, and what a lead costs in your area. A free lead calculator can do the maths for you in a minute.
For most local service businesses running Facebook and Instagram ads, around $1000 a month in ad spend is the minimum to get useful data. Below that, it's hard to tell what's working. We see this across the service businesses we run ads for at Get Paid Leads: steady, sensible spend beats stopping and starting.
The bottom line
Rate rises make customers more careful, not invisible. Keep marketing, point it at the work people still need done, and be the business that answers first. If you're not sure whether your current ads are pulling their weight, a quick marketing score check will show you where the leaks are.
Common questions
What is the RBA cash rate now? 4.60%, after a 0.25% rise announced on 30 September 2026.
Will rates go up again? The RBA said it would increase the cash rate further "if required". CBA economists see a risk of another rise, and expect cuts to start in 2027.
Should I switch from Facebook ads to Google ads when money's tight? Not necessarily. Google catches people already searching, which suits urgent jobs. Facebook and Instagram reach people before they search, which suits planned work. Many businesses do best with both.
